6. Japan’s ministry of finance behaves semi-feudalistic, in the sense the MOF promotes key industries for success despite their effectiveness.

7. Japan’s economic success has created enormous banks as the primary source of operating and growth financing.

8. After 1985, Japanese banks were allowed to pay interest on deposits creating competition among banks for patrons.

9. Members of keiretsu were obligated to have cross-holdings of stock. Companies could not buy and sell stock for profit because of obligation. If they sold the stock, they had to buy it back at the new higher price.

10. Japanese banks are a big part of the stock market.

11. Japanese bank stock is critical to its financial stability.

12. Between 1987 and 89, city banks issued 6 trillion of yen of equity and equity related securities

13. Financial Keiretsu is not good. Banks loan money to customers at cheap rates the companies then turn around a loan the banks their own money back at slightly higher interest rates. It is meant to bolster capital strength.

14. In 1990s, Japan borrowed about $1.5 trillion from Europe then invested in the US. The Japan had to pay a rate for the borrowed money. (http://www.sjsu.edu/faculty/watkins/bubble.htm)

15. In 1990s, Japanese banks lent $600 billion and did most of the lending at the peak of the US real estate market. By 1991, Japanese banks had lent $750 billion

16. In 1990, Japanese banks held 22 percent of the mortgages

17. The collapse of the Tokyo stock market collapsed the banks tier-two capital putting them under pressure to find money.

18. In 1992, the Industrial Bank of Japan and Long term credit bank each had three to four billion of bad loans on properties not making payments